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Decentralized exchange Bunni DEX has announced a complete shutdown after suffering an $8.4 million exploit, making it the second crypto project to cease operations this week. The move follows the earlier collapse of the Kadena founding team, signaling renewed strain in the decentralized finance (DeFi) sector.
In an official statement on X (formerly Twitter) on Thursday, the Bunni team said it would wind down operations due to financial limitations following the exploit that crippled its growth.
“The recent exploit has forced Bunni’s growth to a halt, and in order to securely relaunch, we’d need to pay 6–7 figures in audit and monitoring expenses alone — requiring capital that we simply don’t have,” — Bunni DEX team, in an X post.
The Bunni DEX shutdown underscores the growing financial and technical pressures on decentralized projects facing both market downturns and persistent security threats. The team explained that without substantial capital for security audits and redevelopment, continuing the project was unsustainable.
The Bunni DEX shutdown traces back to a September 2 exploit, when malicious actors drained approximately $8.4 million across Ethereum and layer-2 network Unichain. Bunni immediately halted operations after detecting the attack.
According to a September 4 blog post, the exploit targeted vulnerabilities in the project’s codebase. Built on Uniswap v4, Bunni had been designed to optimize returns for liquidity providers using an innovative Liquidity Distribution Function (LDF) — a feature that allowed efficient capital allocation.
Before the attack, the platform was gaining momentum rapidly. Data from DeFiLlama shows its total value locked (TVL) surged from $2.23 million in June to nearly $80 million by August 19, illustrating how quickly success can turn to collapse in the DeFi space.
While the Bunni DEX shutdown ends the project’s operations, the team made a notable parting gesture to the developer community by relicensing its v2 smart contracts. The code has been transitioned from the Business Source License (BSL) to the MIT license, one of the most open and permissive software licenses available.
This decision has been met with community appreciation, as it allows any developer to freely use, modify, and expand upon Bunni’s innovations — including its liquidity distribution functions, surge fees, and autonomous rebalancing mechanisms.
“Relicensing under MIT ensures that the tools we built will remain accessible to the broader DeFi community,” — Bunni DEX team, in its blog announcement.
The project confirmed that users will still be able to withdraw assets via its website until further notice. Remaining treasury funds will be distributed to BUNNI, LIT, and veBUNNI tokenholders after legal clearance, while team members will not receive any portion.
The Bunni team also noted ongoing cooperation with law enforcement to recover the stolen funds, emphasizing a continued commitment to accountability even after the project’s closure.
The Bunni DEX shutdown comes just days after the Kadena founding team announced its own wind-down, citing “difficult market conditions.” Though the Kadena network itself will remain community-driven, its KDA token has plunged over 70%, now trading at around $0.06, according to CoinGecko.
Together, the two shutdowns highlight a broader industry challenge — where volatile market conditions, rising security costs, and investor fatigue are testing the sustainability of decentralized projects.
As DeFi platforms like Bunni face increasing risks from exploits and high infrastructure costs, analysts warn that more shutdowns may follow unless projects strengthen code audits, governance, and treasury management.
